At SeeChange, Giving Insured Patients Incentives to Stay Healthy
Before he founded SeeChange Health in 2008, CEO Martin Watson was working on new products for UnitedHealthcare Strategy, a wing of the giant healthcare network. As he looked at how the insurance sector was evolving, he thought United should start developing narrower products to help patients be more involved in their own healthcare. “Ultimately, it wasn’t a perfect fit for United,” he says. “So I raised my hand and said, ‘I’d like to give this a try’ and went off and started SeeChange.”
As Obamacare aims to change a broken healthcare system and more and more healthtech companies look to innovate, the insurance models consumers are used to are rapidly changing. For SeeChange, that means pivoting away from a system where patients head to the doctor when they’re sick, pay their copays, and are responsible for following through on medication and follow-up care. The company is working to incentivize patients to commit to their own preventative care, dealing with issues like weight gain and chronic conditions like diabetes before they become an even bigger problem. The idea is to keep patients healthier—and also to save money, both for insurance companies and employers.
Though the idea of incentivized care has been kicked around by a lot of healthcare reform advocates, Watson has only seen a few direct competitors—so far. “We’ve got a unique model right now, but we expect several others to be saying the same thing pretty soon,” he says. In New York, for example, Oscar Insurance has a similar model, but SeeChange has yet to see competitors in California.
SeeChange creates incentives and reminders to help motivate patients to take care of themselves—both through its own insurance company, and through the software solutions it builds for other companies, which integrate benefit plans with health data, claims, and action plans to give consumers a better view of their health and how they can improve it.
Six years after Watson founded SeeChange, the 85-person company is actually two different businesses—SeeChange Health Solutions, which provides software to other companies, and SeeChange Health Insurance. To date, the company has raised more than $80 million, with investors including Psilos Group and other institutional investors. Companies like UnitedHealthcare and Medica use its solutions products, while 4,000 employer groups with 35,000 employees between them have signed on for its insurance plans.
On the insurance side, the company offers fully insured plans for small to midsize employers, companies with between two and 200 or more employees, and self-insured plans for companies with 100 to 1,000 or more employees. “The idea was that typically, the really large, self-funded employers get the innovative designs, because they’re demanding it,” he says. “The smaller end of the employer segment, sometimes they just don’t get those innovations, because the insurance companies have to pick up those costs.”
SeeChange’s plans offer built in rewards; employees are given a six-month window to complete a biometric screening and a health risk questionnaire. When they do, they’re rewarded with breaks like a $1,000 deductible reduction, or a shift in coinsurance payments from 30 percent of the overall bill to zero. In some plans, the company will kick patients a few hundred dollars into a rewards account that can be used to pay other medical expenses.
When screenings find that patients do have health issues like high blood pressure or a high body-mass index, for example, SeeChange will ask them to participate in an online weight management program, or to work with their doctors to help manage high blood pressure. The insurance plan’s personalized dashboard will show users specific tasks they need to complete to improve their health in a given time period; when they do, they get rewarded for it. There is no penalty when patients don’t do what they’re asked; they simply don’t get the rewards that more motivated patients can cash in on, at least on the SeeChange side. Watson does note that some of the large self-funded employers “get a little more aggressive.” In some cases, they will increase employee contributions if goals are not met.
SeeChange can also get really involved. By the time the company sees a claim for, say, treatment of a back injury, chances are a patient has completed the first few steps of a treatment process. But SeeChange can remind that patient to follow through on the last steps, and can even send messages to recommend highly rated physical therapists close to where patients live or work, and break down cost by therapist, so they get a sense of what they’ll pay before they go in for treatment. “Hopefully, we can nudge you to a high-quality, more efficient provider,” Watson says. “We’re building out all these care paths. The concept is presenting actions you can take and tying incentives to them.”
For some conditions, that can get really specific. For type 2 diabetics, for example, SeeChange will not only give patients clinical tasks, like annual eye and foot exams, but it will also recommend meal plans that are good for people with the disease, along with grocery lists. Patients using iPhones and tablets will even receive coupons for specific products that are in stock in grocery stores in the area. It’s a similar story for patients who go in for, say, a throat culture. Bingo, coupons to your local pharmacy for tissues and throat lozenges.
So far, the insurance company is licensed in 25 states, and actively selling its product in California and Colorado.
Compared to other insurance options for employers, SeeChange isn’t the least expensive, but, Martin says, the more employees who take advantage of benefits, the more money employers save. “If you’re looking for just the cheapest, low-end product, that wouldn’t be us,” he says. “We price our product assuming a big percentage will do the things we ask and be in the richer product. You really have to buy into the ‘I want to have a healthy workforce’ idea.”
In its software business, SeeChange has created tailored offerings for different companies, targeting specific types of patients. For United, the company created a plan that specifically targeted type 2 diabetics. If patients met all of the health goals in their tailored action plans, their plans reduced or eliminated copays, and gave them an additional savings of around $500, depending on the employer’s incentive program.
So far, about 60 percent of users have followed through on what SeeChange has asked. “I was hoping it would be higher,” Watson says. “We’ve really been testing out different ways to increase engagement.”
Part of that is making sure that users are presented with all the information that they need in a very user-friendly way, and not making them search for what they are looking for through their health insurance portal.
Though SeeChange’s incentivized solutions and insurance programs are different than a lot of legacy products, there’s nothing stopping older, more established insurers from bringing in similar changes. But, Watson says, because SeeChange is a younger, leaner company, it’s less top heavy and can move more quickly.
“We’re not burdened with some of the legacy issues some of the other carriers have,” he says. “We’re able to implement these designs in a much more efficient manner. The other part is being really lean on the management side. It’s really being very efficient on the admin and the tech to deliver a model that allows you to work within the profit margins.”